A compartmental model has been developed for the analysis of receptor mediated endocytosis. It considers ligand binding to receptors, diffusion at the cell surface, interaction of ligand-receptor complexes with coated pits, internalization of coated pit contents, lysosomal degradation and recycling to the surface. The model makes a number of predictions related to the interpretation of binding data. It has been tested against, and applied to the analysis of, a large body of data on binding and endocytosis of peptide hormones and modulation of the effects of growth factors by tumor promoters.